Gazumping and gazundering – guest post by Phil Spencer

Gazundering and gazumping are bad buying and selling etiquette. Both were popular practices in the 80s but are thankfully less so now that property prices are more stable. A lot of the problem is down to the way that the UK’s system operates, allowing either party to pull out at the last minute, which actually encourages this behaviour. In other countries such as France, however, a non-refundable deposit is given up-front to secure the property — usually up to 10% to demonstrate serious intent. Because in the UK nothing is finalised until the last minute, greed and second thoughts can take over.

Jewel Box Fraher Architects

Image source: Dezeen

What is gazumping?

Gazumping occurs when a seller has accepted a buyer’s offer but then accepts a higher offer from another interested party. This can happen at any time before contracts are exchanged, without signed papers neither party are under any obligation to buy or sell. This is bad news for the buyer. Not only do they lose out on the property, if they have already had surveys completed and paid solicitors they will not get any of this money back — often hundreds, if not thousands of pounds — leaving them out of pocket and without their dream house.

The estate agent is required by law to tell the seller if additional offers are made and it is up to the seller if they consider any additional offers.

If you’re worried about being gazumped you can choose to sign an exclusivity agreement that details an exclusivity period with the seller. A number of insurance companies also offer policies that mean you can recover any fees you have incurred as a result of being gazumped.

The best way to avoid being gazumped is to keep the legal work/ the conveyancing moving along as quickly as possible. Ask for the property to be taken off the market when your offer has been accepted with a sold or under offer sign to be put up and most importantly, keep in communication with the seller’s agent. If the seller knows the sale is progressing they are less likely to consider interest from other buyers.

lots of old keys

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What is gazundering?

Gazundering is more common in a buyer’s market. This is a sneaky tactic whereby the buyer waits until the last minute when everyone in the chain is ready to exchange and then at the last minute lowers their offer. The seller can of course refuse but by this point there is usually too much at stake: schools and jobs have been decided, removal services booked and a lot of money has already been sunk into the move. If the seller refuses at this point it is likely that the whole chain would collapse. Buyers who gazunder know that the seller is also probably in a chain and refusing to accept the reduction in price will mean losing their new home.

To avoid being gazundered start with the asking price, make sure it’s realistic. If you have a realistic price the more quickly you will get an offer for the property and the less likely you will be to end up desperate and selling at any price. Also being upfront about any problems with the property makes it more difficult for buyers to negotiate on these terms late in the game.

Speed is of the essence if you want to avoid being gazumped or gazundered. Keep the sale progressing, this way the buyer will have less time for second thoughts.

Read also: 6 house buying tips when viewing a house

Best,

PHIL

At Rated People  we have more than 30 different trade types from painters and decorators, to handymen and cleaners to help that move go smoothly. Post a job for free with us and get connected with local tradespeople.

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11 comments

    1. It is long overdue for our housing to abide by rules such as those in Francesadly there seems to be to many parties whose self interst block this

    2. I’ll sign your petition, some one is currently trying to gazunder my husband and I over his London flat! We won’t be held ransom by this greedy woman.

  1. Hi Phil

    Slight variation happened to us; we were just about to exchange within what should have been a private sale, when we were gazumped and left with no house and quite considerablz out of pocket.

    Later we found the seller must have in parallel pursued a sale via an estate agent and had in fact accepted two offers at the same time – our private one and the one via an estate agent.

    Now legally, can a seller accept two offers and let them run for months in parallel??

    Rgds
    Jurgen

  2. On the day of completion the seller demanded’ £20.000 thousend pounds more’ for the parking space that his solicitor had already put in writing The seller claimed that was a mistake on the part of his solicitor and that He would not let me buy my flat unless I paid What can be done in such cases? .

  3. I was gunzundered in 1996 by a conveyance company the day before contracts were to be signed. They asked for £3,000 off my asking price. This was allowed to happen due to my solicitor going on holiday and leaving a trainee in place and the estate agent not passing information to my buyer. The situation was that a path that passed through my land was not a right of way but an access path for the other five terraced houses. The conveyance company said that a legal removal of the access needed to be moved to the new path circumventing the land I had purchased in front of the access path. My neighbours had no problem with the new path going round my additional land and which I had sought their permission from them to use this instead of the old access path. I was angry with the agent and the buyer whom I said I would leave a brand new cooker for them which I had earlier purchased. The solicitor on her return from holiday was not interested. Thus I agreed to pay £1,500 and let my buyer cover the remainder. I sold the cooker and paid the agent half his fee as I had done most of the negotiating for him. I had had to pay my buyers deposit as the woman buying my house was having the house purchased by her mother in law and the woman had separated from her son. If the agent has done their job this could have been avoided.

  4. We have just been gazundered massively because of Brexit 0 100K off teh asking price and he refuses to be reasonable. I cant belive there is nothing we can do in England to stop this happening – it is disgraceful! He has us over a barrel!!!

    HELP!!!!!!!!!

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